Barrick Gold slashes Argentina mine output forecast after spill

Mon Apr 24, 2017 6:39pm EDT
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By Nicole Mordant

(Reuters) - Barrick Gold reported weaker-than-expected quarterly earnings on Monday and also slashed its forecast for output and hiked costs at its gold mine in Argentina, where cyanide solution spilled recently for the third time in 18 months.

Barrick, which is the world's largest gold miner, also lowered its forecast for 2017 group gold production largely because of the sale of a 50 percent stake in the Argentinian mine, Veladero, to a Chinese miner last month.

Its shares fell more than 3 percent after hours.

Barrick said it expects normal operations to resume at Veladero in June, pending government approval and the lifting of judicial restrictions.

Argentine regulators suspended the addition of cyanide to Veladero's leach pad processing operation and told Barrick to overhaul environmental practices and operations at the mine following the March 28 spill.

The June date was based on its "assessment of the time required to complete the proposed modifications to the leach pad," Barrick said in a statement.

Barrick said it now expects full-year production at Veladero of 630,000 to 730,000 ounces of gold, at all-in sustaining costs of $890 to $990 per ounce.

That is 12 percent to 18 percent down from Barrick's previous forecast of 770,000 to 830,000 ounces. It had previously expected mine costs of $840 to $940 per ounce.   Continued...

FILE PHOTO: Barrick Gold Corp Chairman of the board John Thornton speaks during their annual general meeting for shareholders in Toronto, Ontario, Canada on April 28, 2015.    REUTERS/Mark Blinch/File Photo